Skip to main content
E
ejinayoshi
January 11, 2024
Solved

Reimbursement from a retainer when invoicing from a different system

  • January 11, 2024
  • 1 reply
  • 0 views

I'm an attorney and take retainers from clients.  I have the retainers set up under a Trust Account Liabilities Account, with sub accounts for each client.  I invoice my clients from my CRM system.  Occasionally I have to pay a vendor online with my office credit card, although the expense will actually be paid eventually from the client's retainer.   When I pay the vendor online, the payment comes from my checking account.  I then transfer the funds from the client trust account liability account to my checking.  But I don't want the vendor payment showing as an expense of my firm (which would cause me to understate my profit for tax purposes). How should I account properly for the vendor payment when I pay it from my accounts, then reimburse myself from my client's retainer bearing in mind that I have already generated an invoice to my client in a different system?

Best answer by FateCandylaneT

I've come to help you handle clients' retainers and reimburse the payments into your account, ejinayoshi.

 

You can turn the retainer or deposit you previously received into credit on an invoice and receive it like a payment. Then transfer the funds to your checking bank account. To do that:

 

  1. Go to the + New icon.
  2. Select Transfer.
  3. From the Transfer Funds From ▼ dropdown menu, select your trust liability bank account.
  4. From the Transfer Funds To ▼ dropdown menu, choose your operating bank account.
  5. Enter the amount that you just received as payment for the invoice.
  6. Once done, select Save and Close.

 

The money is now recorded as having moved from the special trust account to your business' operating account. You may also visit this guide for more insights: Record a retainer or deposit.

 

In addition to that, I recommend consulting your accounting professional to seek further guidance in handling the vendor payments made and the accounts affected.

 

I'll be sharing this handy resource to help you review your business finances and track your company's cashflows: Run reports in QuickBooks Online.

 

You can always get back to this thread if there's anything else you need further assistance with. I'll be right here whenever you require additional help. Take care and have a great day ahead.

1 reply

F
FateCandylaneTAnswer
January 11, 2024

I've come to help you handle clients' retainers and reimburse the payments into your account, ejinayoshi.

 

You can turn the retainer or deposit you previously received into credit on an invoice and receive it like a payment. Then transfer the funds to your checking bank account. To do that:

 

  1. Go to the + New icon.
  2. Select Transfer.
  3. From the Transfer Funds From ▼ dropdown menu, select your trust liability bank account.
  4. From the Transfer Funds To ▼ dropdown menu, choose your operating bank account.
  5. Enter the amount that you just received as payment for the invoice.
  6. Once done, select Save and Close.

 

The money is now recorded as having moved from the special trust account to your business' operating account. You may also visit this guide for more insights: Record a retainer or deposit.

 

In addition to that, I recommend consulting your accounting professional to seek further guidance in handling the vendor payments made and the accounts affected.

 

I'll be sharing this handy resource to help you review your business finances and track your company's cashflows: Run reports in QuickBooks Online.

 

You can always get back to this thread if there's anything else you need further assistance with. I'll be right here whenever you require additional help. Take care and have a great day ahead.

Terms & ConditionsAccessibility statement